It is one of India’s fastest-concluded FTAs after signing six Free Trade Agreements in the last five years, the latest being with Oman.
- FTA is an agreement between two or more countries where the countries agree on certain obligations that affect trade in goods and services, and protections for investors and intellectual property rights, etc.
Salient Features of FTA
- Zero-Duty Market Access: Eliminates customs duty on 100% of Indian exports, significantly enhancing trade competitiveness.
- Healthcare & Traditional Medicine Cooperation: First-ever Annex on Health and Traditional Medicine Services signed by New Zealand.
- Agricultural Value Chain Integration: Agricultural Productivity Partnership to improve farm productivity and integrate farmers into global value chains.
Why are FTA’s important for India?
- Export Market Diversification: FTAs reduces over-dependence on traditional markets like the USA (recently imposed 50% tariff on goods from India).
- Long-Term Investment Boost: New Zealand has committed to invest USD 20 billion over 15 years.
- MSME Integration: FTAs link Indian MSMEs to global value chains, boosting exports and employment.
- Skilled Mobility: E.g., India-New Zealand FTA provides temporary employment entry visas for up to 5,000 professionals at any given time, spanning sectors such as IT, engineering, etc.
- Improved Competitiveness: Zero or low tariffs help Indian goods compete effectively.
- Strategic Partnerships: FTAs strengthen economic diplomacy and India’s geopolitical influence.
- Other: Export-Led Growth, etc.
